Tuesday, February 5, 2008

Thinking Outside the Box: Creating Relationships Through Promotions.

Here at Maine State CU we recently decided to bring a lot of the marketing under internal direction. We had the first meeting of our Internal Marketing Committee last week, and as far as I'm concerned it went pretty well.


The only thing I noticed was that most of the ideas that were brought to the table were very traditional and orthodox marketingletmeoutofthebox initiatives.


We were discussing the possibility of a President's day auto loan promotion. We ended up deciding that the best thing to do would be to just promote our indirect lending.


I Would have disagreed, but to be honest I'm still getting used to the fact that my opinion has an impact on what we do here.


The usual rate promotions, or promoting something like indirect lending (which I whole heartedly dislike, but that's a topic for another post) aren't going to change peoples' minds about the credit union or get them to decide to go with us instead of a bank.


My point is, we need to think outside the box if we're going to bring in new members with a promotion. It takes something that Bank of America can't or doesn't offer.


Offer the membership something that they find relevant locally and makes them feel like they are part of the community. It could even be something that makes them feel like they are making a difference by taking out that auto loan.


Offer a discount for fuel efficient cars (I know, the "green" loan is becoming something of a staple these days) or a loan that makes a donation to a local charity or cause on every payment. Something that says "I'm part of this" and makes people feel good about taking the loan out at the credit union instead of a bank.


The whole point of a promotion is to get people to look at your institution, try it out, and build a relationship. With Indirect lending its just that, indirect. Being indirect is completely contrary to the credit union's purpose. One of the big differences credit unions should embrace is being very direct, very involved, and very personal.


Indirect lending might get a few people to take out loans with the credit union, but once that loan is paid off, are they going to stick around and keep their accounts here? Most of the people I see come into the credit union through indirect lending don't even know they have opened an account through the process.


If you want to create a relationship with new members, you've got to be working on that direct relationship from the get-go.

5 comments:

Lee said...

Don't let the fact you're new at this stop you from weighing in. The idea of bringing you to the table is fresh insight. Isn't the whole concept of what we're tying to do is shake it up? Also, I know that I'l like to see members come directly to us for the loan and cut out the dealer.

Finally, my pet peeve is there is no such holiday as President's Day. If you google "Federal Holiday" you'll the that day is Washington's Birthday.

Andy said...

Thanks Lee,

I guess I'm just getting used to being able to shake it up. I'd love to see some things change.

I really feel there is no need for indirect lending. It just adds one more middleman to a process that is already confusing and creates a section of membership with almost no connection or relationship with the credit union.


Oh, and thats one of my pet peeves as well, Washington ought to have his own holiday. The man was a brilliant leader and a keystone in the creation of our country.

Alright, I'll stop ranting now :)

Roger Conant said...

I've just read your blog for first time...good stuff "from the "firing line"! Until last Feb., I worked for an indirect CUSO for 3 years (marketing). I won't mince words. Indirect lending is counter-advocacy. It is an obvious compromise of a basic "understood" promise that CU's have had since Filene...to ALWAYS act as an ADVOCATE for the member.

You can't maintain that "posture" and participate in indirect lending. Time and time again I would see CUs passively ignore the fact that a member was being nothing less than "taken" with an incredibly inflated charge for an extended warranty...in the name of the CUs "indirect" relationship with their "dealer" network. It's wrong...but I saw the "winds of change" taking place in the marketplace after the Centrix mess. And that will continue. The consumer will always win...eventually.

Mary said...

This whole Indirect thing intrigues me. I know that some have said after doing extensive research, indirect lending is deemed to streamline the process for the member (or potential member) and ultimately helps provide a more gratifying buying experience. Perhaps we simply must find a way to do better follow up to ensure the critical "meaningful connection." It may not be the service itself that is the culprit; rather steps in the process that need revision and improvement.

Andy said...

@Mary

It is possible to contact those indirect members after they have taken out the loan and try to connect with them, and I'm sure it does make it a tiny bit easier for the member to take out the loan this way, but couldn't that convenience be matched by a good online application?

Also, just the idea of a car salesman being the first connection a new member makes with the credit union is strange to me. To me it takes away a bit of the "this is my credit union" feeling of going directly through the institution and having the service occur under the credit unions roof...even if that roof is virtual.